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Cryptocurrencies have been a hot topic and many may feel like they've missed the bitcoin and ethereum bandwagon.

As such, they may be asking: what's the next crypto bandwagon they can jump on?

There is little doubt that some of these alt-coins, such as ripple and litecoin, have probably popped up in recent conversation about digital currencies. But what are the alternatives and are they stable and credible?

We asked cryptocurrency exchange London Block Exchange to give us the key points on some of the main alternatives.

This is Money would also like to add that this is not an endorsement of any of the digital currencies and because of the volatile nature, we urge you to read the fact box below.

For example, this morning (16 January 2018) prices of most of the digital currencies have fallen by a quarter.

Furthermore, it is imperative to do more research if you're thinking of parting with your cash. Below is a taster of each digital alternative - but each one is complex in its own right.

BITCOIN (BTC)

Firstly, let's start with the bitcoin basics. The digital currency that most will be familiar with is free from government interference and can be shared instantly online. It doesn't rely on trusting one central monetary authority.

The underlying technology is blockchain, a financial ledger maintained by a network of computers that can track the movement of any asset without the need for a central regulator.

The price exploded in the second half of last year and as such, saw it race towards the $20,000 mark before Christmas.

Since then, it has nearly halved in value and it may mean that many who invested in December could have been badly burnt.

SEVEN ALTERNATIVES

RIPPLE (XRP)

Ripple works as a decentralised payments network. However, unlike other cryptocurrencies, it works largely to enhance traditional financial systems.

Its unit of cryptocurrency is called XRP - and its purpose is to bring speed, transparency and security to conventional financial processes.

The value of an XRP is much lower than a bitcoin, however there are more XRP available than Bitcoin (100billion vs 21million).

Unlike other cryptocurrencies, Ripple doesn't need to be mined - it can only be bought from exchanges.

Price? At present, the coin sits at $1.35. It reached a high of $3.40 in mid-January, so has more than halved in value since.

However, at the start of December, it stood at $0.25 a coin, meaning some may have already vastly profited from XRP.

LITECOIN (LTC)

Many people are unaware that litecoin originally served as a modification of the core bitcoin protocol - it's a cryptocurrency that can generate more blocks in less time, and handle a higher volume of transactions than bitcoin.

It allows quicker transaction confirmation - if bitcoin takes ten minutes to generate a block, litecoin can do it in two-and-a-half minutes.

Rewards for mining bitcoin are halved every time a further 210,000 blocks are mined. This is to slow down the mining of bitcoin, which has a finite supply. Litecoin rewards are also halved periodically, but only after every 840,000 blocks.

While bitcoin is capped at 21million, litecoin is capped at 84million - significantly higher than bitcoin, however not as much as ether at 98million and growing.

Its software protocol is called 'SegWit'

Price? At present, the coin sits at $208. It reached a high of $360 in mid-December.

At the start of December, it was $99 a coin, meaning it surged in that two week period and highlights the volatile nature of these currencies.

DASH (DASH)

Like litecoin, dash was originally developed to improve upon the weakness of the bitcoin network.

Created as XCoin, the project then changed its name to darkcoin before finding its current identity of dash, representing 'digital cash.'

The developers of dash created the world's first self-funding and self-governed blockchain protocol, a peer-to-peer cryptocurrency that uses a two-tier developer network, rather than a single-tier one where all tasks are completed by miners.

This has been achieved through an incentive-based system.

Currently, 10 per cent of each block portion is allocated back to dash developers, who receive payments for their contributions, unlike bitcoin (where contributions are voluntary).

As a result, a number of high-tech features have been added to dash by their developers.

One key feature of dash is masternodes – an incentive-based system that encourages users with payments to secure the network and add additional features to it.

Masternode operators get 45 per cent of the reward for every dash block that is mined.

Additional features include something called 'InstantSend' that can send and confirm transactions globally in seconds and 'PrivateSend,' which allows dash users to remain completely anonymous.

Price? Currently, the price of dash sits at $790 a coin. It reached a peak of $1,550 in late December. At the start of November, it sat at $260 a coin.

BITCOIN CASH (BCH)

Bitcoin cash was created by 'forking' the original bitcoin protocol in 2017, which enabled more transactions to be processed and to increase the size of the blocks available.

The developers were concerned about using 'SegWit' – the software model that litecoin is based on, because they felt it did not address the core issue of scalability and felt it wasn't transparent enough.

Litecoin's SegWit change used a 'soft fork', but developers of bitcoin cash developed a 'hard fork.' This means old applications will not function with the new blockchain, which has an increased block size - meaning the verification and block confirmation process is sped up.

Miners are encouraged to join the bitcoin cash network by a more dynamic difficulty adjustment algorithm (DAA) than the bitcoin network.

This means that the chances of finding a new block are updated once per day. Bitcoin's difficulty is adjusted every 2016 blocks, or approximately every fortnight.

Price? Currently, bitcoin cash sits at $1,950 a coin, which is huge considering it only forked from original bitcoin in the summer. It peaked at $3,830 in late December.

MONERO (XMR)

Like bitcoin, monero enables a direct digital exchange of value between two parties, however, unlike bitcoin, monero transactions are completely private.

It uses the CyptoNight algorithm, which implements 'ring signatures' and 'stealth addresses' to muddle up each transaction's value, origin and destination and obscure the the sender and recipient's identities.

HAVE YOUR SAY

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Have you invested in any digital currencies - and if so, let us know your stories below.

Because each unit of value is 'fungible' or interchangeable, monero overcomes the concern that tracked or 'coloured' coins might restrict the usability of a blockchain currency.

The supply of monero will be infinite, with block rewards smoothly decreasing until 2022 when a minimum coin creation rate of 18 XMR per hour will be maintained.

Last week, it was claimed that North Korea is taking an interest in monero. Allegedly, evidence was found of malware that took over a person's computer and mined it. This was then sent back to Kim Il Sung University in Pyongyang.

Price? Monero currently sits at $350 a coin, after peaking a few days ago at $495. In August, it was just $1 a coin.

IOTA (IOTA)

Iota is a cryptocurrency designed for the 'Internet of Things', hence the acronym.

Rather than using a blockchain ledger like bitcoin, iota uses a system called 'The Tangle' which aims to solve the transaction fees and scalability concerns presented by bitcoin.

This will be achieved by asking the sender to create and verify a transaction at once, which removes dependency on miners and ensures the system is completely decentralised.

In addition, while bitcoin speed decreases as the number of users increase, Iota's speed increases as the number of users increase.

Price? Iota currently sits at $3 a coin. It peaked at $5.25 towards the end of December and sat at $0.35 at the start of November.

NEM (XEM)

New Economy Movement (Nem) powers what is known as the Smart Asset System - this aims to power the blockchain economy by offering a range of secure and tested features.

It is intended to be an open, customisable blockchain solution that gives easy access to Nameserver and API tools, with transactions processed by a global network of nodes.

Ultimately, this means building blockchain software is simpler for developers who use the Nem network, because of its structured tools for app development and flexibility.

Nem introduced the concept algorithm called 'Proof of Importance' for coin issuance, which works in a similar way to 'Proof of Stake', saving energy and being more scalable than the traditional 'Proof of Work' algorithm.

Rather than mining, Nem users can create coins on the network by acting as a public node and 'harvesting' rewards from block creation and collecting fees from the processed transactions.

In order to reduce the impact of 'bad actor' masternodes on the network, Nem uses the Eigentrust++ algorithm, which allows nodes to 'judge' each other and optimise the load balance.

By using a custom time synchronisation protocol, Nem avoids the risk of the network losing consensus because of external effects from incorrect NTP servers.

Price? Currently, Nem sits at $1.14 a coin - roughly 20 per cent of its peak registered at the start of January. At the beginning of December, it sat at $0.25 a coin.

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